Truworths sales take a hit as disposable incomes slump in SA and UK

Truworths International said retail sales declined as consumers remained under pressure, with the retailer warning that fuel-driven inflation and weaker disposable incomes had weighed on discretionary spending.

The fashion retailer reported on Thursday that group retail sales fell 0.9% to R21.8bn for the 52 weeks ended June 28 2026, from R22bn previously.

The group said the year was characterised by subdued consumer spending in both South Africa and the UK, with global uncertainty, higher living costs and renewed inflationary pressures undermining household confidence.

Truworths Africa, which accounts for the bulk of the group’s sales, was the main drag. Retail sales declined 2.1% to R14.2bn, although the performance improved materially in the second half, when sales fell just 0.1%, compared with a 3.6% decline in the first half.

The retailer said sales in its South African business were encouraging during the early months of the 2026 calendar year before momentum weakened towards the end of the financial year as higher fuel costs put further pressure on consumers’ disposable income.

The deterioration came after a brief improvement in consumer sentiment at the beginning of the second half. Moderating inflation, expectations of further interest-rate relief and the reception to the February budget had initially pointed towards stronger consumer confidence.

That recovery was short-lived, however, as the escalation of conflict in the Middle East pushed up global oil prices and fuel costs, squeezing households that had only recently started to benefit from lower inflation, said Truworths.

“The second half of the period opened on a more constructive footing but sentiment weakened in both South Africa and the UK as the second half progressed,” it said.

Truworths account sales in South Africa declined 0.9% and accounted for 71% of Truworths Africa’s retail sales, while cash sales fell 5%.

“The group maintained a prudent approach to credit granting throughout the period as a result of the uncertain trading environment,” the company said in a statement.

While the number of active accounts was broadly unchanged, there was a decline in the proportion of active account holders able to purchase, which fell to 77% from 79% a year earlier, reflecting pressure on customers’ disposable income.

The group’s UK business, Office, reported retail sales increased by 4.9% in pound terms to £334.1m and rose 1.3% to R7.6bn when translated into rand.

Truworths expects full-year headline earnings per share to decline between 2% and 4% to between 722c and 737c.